image of the horticulture sector
TRANSCRIPT
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Image of the Horticulture
Sector
Kingdom of Saudi Arabia
March 2007
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Situation Analysis
Sector / country information
Problem tree (simplified)
Vision on the supply chain Stakeholders analysis
SWOT
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Sector / Country Info.
Total production of vegetable in 2005 is 2.5million tons, 20 % in greenhouses
Greenhouse distribution: 44% in RiyadhProv., 24% in Eastern Prov., 11% inQassim Prov.
Self sufficiency: 84%
Net Imports: 477,000 tons
Total population:24 millions
Per capita: declining from 121 kg in 1998 to68,6 km in 2006 (source: Euromonitor)(more efficient consumption and lesswaste???)
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Sensitive Issues
labour / saudization,
source of food for the
region
marketing, wholesalemarket, market
researches
SAAB financing (are
farmers complaining?); cooperatives?
Processing?
Export !
Quality measures
Food safety
National policy
Lots of sensitivity in the
chain
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PROBLEM TREE!
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Farmers are not cooperating
No marketing / promotion
Expensive input material &services
High costs of production
strain on quality
Customer is ignorant lack of awareness
Strain on demand
- consumption /
capitaLack of
confidence
SafetyPrice
Lowest prices for produce
Depressed Farmers
less profits / sometimes loses
Dominance of middlemen in
the wholesale market
Bad behaviourlack of trust
No transparency
No joint commitment /obligations between
members and board
Interest is not clearExisting cooperatives,socially based / GOV
funded
No quality measures /standards
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Weak processingopportunity
Very limitedInternational demand
Export logistics not organized
Nominal exports to UK & GCC
Absence ofcooperation in SC
Wasted opportunity /
inefficient sector / loss
National
Losses UnemploymentLong term
social problems
Lack of marketresearch and studies
Weak consumerfeedback awareness
Absence of consumerorganizations
Research organizations arenot professional / realistic
Frustrated demand / consumption
Depressed FarmersSmall > out ofbusiness / acquisitions
Medium > Struggle / keep their heads low
Large > struggle / not growing
Health concerns, more diseases
Low productivity
Absence of market
information
GOV org.
Market
WS Market
Excessive useof chemicals
Lack of training /extension service MOA
no inspection /monitoring, SFDA in
establishment
Safety concernby consumer
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How is the chain organized
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Growers
Production is
490,000 tons
vegetables in
GH
Consumersvolume consumedis 10% smaller
because of waste
in the chain
processingWholesale market
Local retail
market
Small grocery
shops
Chain
supermarkets /
Hypermarkets
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Supply Chain!
Forms of cooperation:
Vertical cooperation over the chain (limited
large producers/ supermarkets)
Very primitive horizontal cooperation
Not organized
RESULT
Lack of cooperation over supply chain(low efficiency / waste of opportunities &
investments / burden on national economy)
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Stakeholders
Main players:
King MOA / SFDA / MOW Farmers Supermarkets
Secondary Players:
WS Market Food Processing Research Inst. Universities
Responsive players:
Agri Bank - Agri Comm. / Agri Dept. / Agri Coop
Negative:
Consumers
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StakeholdersOrganization Characteristic Interest Resources
King Main player Food Security Policy / power
MOA / SFDA Policy maker Salary Policy maker
Farmers Main player Profit Money / feasibility
studiesAgri Bank Implement policy Negative
Agri Dep CCI Secondary Salary Admin / monitoring /
feedbackAgri Committee Initiator Organization
Cooperative(s) ?
Research Inst. Secondary Far from needs
Input suppliers Secondary Profit New tech
Wholesale mrkt Secondary Profit Logistics,
technology / newproducts /Supermarket Main Profit
Food processing Main Profit
Consumer Secondary Food safety /
availability /
cheap
Feedback
Active &
Playingstrong role
Playing
weak role
Only
responsive
role
Not
playing his
role
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SWOT Hortisector KSA
Strengths WeaknessesCost of production
Favourable weather conditions
Attractive investment costs
Research
Local experts
Opportunities ThreatsOrganic production
Health concernsGrowing demand in the region
Water survey is not finished
Not cooperative